AIRBUS has suffered a double embarrassment after being forced to withdraw its flagship A400M military plane and the A380 superjumbo from a flying display at the Paris Air Show today.

Gearbox trouble grounded Europe's costliest military plane from showing its paces in what had been billed as a "daring display". Wing damage during manoeuvres at Le Bourget airport kept the A380 on the tarmac.

Airbus was left particularly red–faced at having to cancel the public debut of the A400M, the troop carrier running four years late and developed at a cost of more than €20bn (£17.6bn) for Britain, France, Germany and four other nations.

The flypast would have been one of the highlights of the week–long show but the gearbox problem in one of the huge turbo–props is the latest setback for a project plagued by delays and squabbles, extending to a row over the name.

Airbus has nicknamed the plane "Grizzly" but an indignant RAF intends to call the aircraft Atlas to reflect its endurance capabilities when it makes its debut at Farnborough next month. Air Chief Marshall Sir Stephen Dalton has said "Grizzly" would be accepted "over my dead body".

There are doubts about whether Atlas will be cleared for take off in time for the British air show following the discovery of the gearbox problem.

Domingo Urena–Raso, Airbus Military chief executive, said: "Flight test requirements are very demanding at the moment."

The long development delays have exasperated politicians and air forces.

On the corporate front, the chief executive of Airbus–owner EADS said he believed France and Germany could give up some of their 22.5pc holdings in the company without leaving it vulnerable to takeover.

Louis Gallois said the existing structure was "extremely rigid", adding: "An extension of the free float would be a benefit for all shareholders."